Hanlong boss jailed for insider trading

AAP

Former Hanlong mining boss Hui Xiao has been sentenced to more than eight years jail in one of the biggest insider trading cases in Australian history.

Xiao made a profit of $1.7 million from more than 100 illegal trades in 2011 in financial products related to Australian mining companies Bannerman Resources and Sundance Resources.

He was handed a maximum sentence of eight years and three months in the NSW Supreme Court on Friday, and will be eligible for parole in July 2019.

Xiao has been in custody since his arrest in Hong Kong in January 2014, three years after he fled from Australian authorities while in China.

He eventually pleaded guilty to three charges related to a period when he headed the Australian arm of Chinese firm Hanlong Mining, the Australian Securities and Investments Commission (ASIC) said.

ASIC Commissioner Cathie Armour said it was one of the toughest penalties handed down in Australia for insider trading.

"It may be the longest sentence," Ms Armour told reporters.

"We're very pleased with the seriousness with which insider trading is regarded."

ASIC alleged Xiao acquired shares and financial products in Bannerman and Sundance through his wife and companies in the Virgin Islands and Australia prior to Hanlong making takeover offers.

Hanlong's $144 million takeover bid for Bannerman in 2011 proved unsuccessful, and in 2013, Hanlong terminated a $1.3 billion takeover of Sundance Resources.

Ms Armour also confirmed former Hanlong directors Simon Yang and Nelson Chen, who is a director of Perth-based Moly Mines, would not be prosecuted.

"We can't take cases if we don't have evidence of wrongdoing," Ms Armour said.

Hanlong's previous owner, billionaire Liu Han, was sentenced to death in China last year for running a crime syndicate.